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Analysts lifted their expectations for U.S. real GDP growth and hiring through next year compared to three months ago, according to a Federal Reserve Bank of Philadelphia survey released Monday, while inflation projections were little changed.
The Philly Fed’s quarterly Survey of Professional Forecasters showed growth is expected to slow from 4.9% in the third quarter to 1.3% in the fourth and 0.8% in the first quarter of 2024. On an annual-average basis, GDP is expected to slow to 1.7% next year from 2.4% this year, according to the 34 analysts surveyed. These annual projections are 0.4 and 0.3 percentage points higher, respectively, than the estimates in the previous survey.
The forecasters see higher job gains for 2023 and 2024 but little change in the unemployment rate. The projections for the annual-average level of nonfarm payroll employment imply job gains at a monthly rate of 296,500 in 2023 and 120,000 in 2024, up from the previous estimate of 288,600 and 94,800.
Expectations for inflation were little changed with the median forecaster seeing 2.7% core PCE by the end of this year and 2.2% next year. The forecasters raised their probability estimates for negative growth for 2024, now predicting a near-40% chance of a contraction in real GDP in any of the four quarters in 2024.
Source: Philadelphia Fed
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.